Behavioral studies have shown similarity of action between benzodiazepines (BDZs) and facilitation of GABAergic transmission, indicating that the pharmacological action of BDZs is mediated through GABAergic synapses. The molecular composition of the GABA receptors was studied biochemically. Two separate binding sites (one for 3H-GABA and one for 3H-diazepam) were isolated by differential solubilzation from rat brain homogenates with Triton X-100. Another element of the GABA receptor complex has been isolated, and endogenous brain peptide (EBP) that probably represents the endogenous ligand for the BDZ receptor. EBP was prepared from rat brain either by extraction in hot 1n acetic adcid or by Triton x-100-treatment of frozen-thawed crude synaptic membranes. Gel chromatography revealed a peak of inhibitory material that is sensitive to proteolytic enzymes. This material inhibits specifically 3H-diazepam binding and resolves into 2 major bands after electrophoresis on a SDS-12% acrylamide gel. Another protein operative in GABA receptor function is GABA modulin, which is being characterized and purified. These data suggest that GABA receptors and BDZ receptors are functionally associated and that an endogenous peptide regulates their function.